The Blockchain Hype And The Webvan That Never Existed

I'm fortunate enough to have been survived a couple of successful businesses and a half a dozen of failures, as an entrepreneur. Most of them in the digital space. Or, as we used to say, "in the online".

20 years ago, if somebody would have asked you what do you do for a living, if you really wanted to be cool, you would have answered: "I'm in the online". Oh, the bewilderment on their faces! Oh, the awkward silence! The barely contained admiration, sometimes expressed in many subsequent invitations "to a coffee, just to chat about that thing that you're doing".

20 years ago, online was hype. It was the thing, the place to be, the path to take, the career to embrace. It was the future.

But where is "the online" now?

Well, since pretty much all our communication is done online, it just became the norm. It lost that magic trait of being exquisite and promising and mysterious and became your daily thing. Just like brushing your teeth. There's noting spectacular, promising and mysterious about brushing your teeth. But you're doing it, because you know it's the right thing to do.

The "Blockchain" craze is just like the "Online" craze was 20 years ago.

There's so much momentum, so much excitement and so many contained promises, that the whole concept is sometimes perceived with borderline religious feelings: "it will completely change the world, it will revolutionize the planet, it will do this and that and we will all live happily ever after".

Well, not so fast, grasshopper!

I think I've seen this before, so bear with me for a a few minutes.

The Webvan Startup

Back in the early 2000s, a startup called "Webvan" promised to do something unthinkable: link your fridge to this global network called "the web" and deliver groceries to your door, without you moving a finger. It was the fridge which was responsible for reading the barcodes of the products you took away or squeezed in it. A small computing device would have been keeping track of all these movements, calculate the remaining supply and order whatever you need to order in such a way that you will never have an empty fridge anymore.

20 years after, we have no successful Webvan. Not even a proof of concept that I am aware of.

But boy, it sounded nice on paper! It was so promising and revolutionary that investors were queuing just to have a chance to get 1% of this huge pie.

Correction: "of this huge potential pie".

A Promise Is Just A Promise, Nothing More

Many blockchain based startups today are selling just promises. Nothing more.

Please try to do the following exercise: breathe 5 times in a row, without thinking at anything and re-read that revolutionary white-paper you just decided to put all your savings in. You'd be surprised how much vaporware is in it, and how little actual value it has.

Riding the wave of excitement is tricky. Both for innovators and for users. Innovators will try to take advantage as much as they can of the hype, and they'll do whatever they can to sell you the unthinkable. And users, well, they thrive on wishful thinking, we already know that.

Please take a step back, look at all those promising blockchain "stars" in top 20 crypto currencies and try to compare them with the "Webvan". Do you really see that blockchain thing unfolding in 20 years from now? Do you really believe it will take off?

And then look at more "boring" tokens, which are already delivering much smaller promises. Like, you know, privacy enhancement (Monero), zero transaction fees and 3 seconds block production (BitShares) or even social media on top of the blockchain (Steem).

They may be boring, but they are already here. You can use them every day and you can track their usability. They're real.

Be wise.

The "blockchain" is a wonderful technology, but that doesn't mean you are allowed to be stupid and make stupid investments.

I'm a serial entrepreneur, blogger and ultrarunner. You can find me mainly on my blog at Dragos Roua where I write about productivity, business, relationships and running. Here on Steemit you may stay updated by following me @dragosroua.

"blockchain" is a wonderful technology, but that doesn't mean you are allowed to be stupid and make stupid investments

There are a lot of lemmings out there, willing to follow which ever guru has the fanciest promises. Usually if something seems to good to be true, it contains false hopes.

link your fridge to this global network called "the web" and deliver groceries to your door, without you moving a finger. It was the fridge which was responsible for reading the barcodes of the products you took away or squeezed in it. A small computing device would have been keeping track of all these movements, calculate the remaining supply and order whatever you need to order in such a way that you will never have an empty fridge any more. 20 years after, we have no successful Webvan. Not even a proof of concept that I am aware of.

Roughly 18 years ago, in San Jose Costa Rica, there was a very short test run of smart fridges. The make of the fridge was LG, I believe and when you bought one of these hugely expensive fridges and connected it to the internet, you could get you groceries delivered form one particular store called the AutoMecado. It was the only store you could use, and it also was more expensive than other options. The up shot was that the trial run only lasted a couple of years.

Yup, so many vaporwares and then there have been currencies which had plagiarized content in their whitepapers, and yet went on to have more than a billion dollars market cap. So, one should research well before investing, and not just jump on the bandwagons.

Very true @dragosroua. We should breathe deeply and discern what is really in our hearts. The blockchain is more volatile than our national brokerage. Sure the rewards are also volatile and just as wild. Proper study is needed.

Blockchain trend is going down. We will see cooling interest towards it already in 2016. The same applies to smart-contract hype, ok, it has just started so maybe early 2017. A lot of Bitcoin/Blockchain startups that have enormous valuation will fail soon. The reason is simple — nobody needs blockchain
Neither a bank nor a financial institution has implemented blockchain technology yet.
People have been advocating blockchain as a magic wand to solve many global problems (like securing nuclear weapons and managing the power grid); I have been compelled to humbly add that its potential at scrambling eggs should not be underestimated.@dragosroua

Thank you for this enlightening article. As someone new to steemit it is refreshing to come upon an piece which calmly yet wisely explains things. I will in need be looking at the extra links at the bottom.

A well needed flush of reality. I hear a lot of optimistic people preaching HODL - but if you hold on for dear life to a rock you'll probably drown.

It's been fun to catch the trading bug and even through some Steem into these "penny coins," in the hopes that a cent will turn into a dollar. But I don't kid myself that I really know what I'm doing. And I'd be a lot more nervous if I were investing money I wage-slaved over.